Ontario to give first-time home buyers a tax break.

In a bid to boost housing starts, the Ontario government announced a big win for first-time home buyers - removing the eight per cent provincial portion of the HST  for new homes up to $1 million.

The province’s proposal, which will be included in the 2025 Fall Economic Statement, would save first-time home buyers up to $80,000 off the cost of a new home when combined with existing provincial relief.

The province is matching the federal government’s proposed removal of its five per cent portion of the HST — which would save up to $50,000 off the cost of a new home — for savings of up to $130,000.

Ontario will work with the federal government to propose that the new Ontario rebate be available if the agreement of purchase and sale for the home is entered into with the builder on or after May 27, 2025, and before 2031. Construction of the home must begin before 2031, and the home must be substantially completed before 2036.

Other eligibility criteria for the new Ontario rebate would follow those set by the federal government, including that the individual must be buying the new home for use as their primary place of residence.

In a statement, Ontario Real Estate Association (OREA) president Cathy Polan called the plan a “step in the right direction for the future of this province.”

She said this type of action “is exactly what we need to help young Ontarians and their families get a foot on the homeownership ladder.”

While the Bank of Canada cut the key interest rate on Wednesday to 2.25 per cent, the five-year Government of Canada bond yield, which is what fixed rates are based on, actually went up. 

On the rate relief side, it’s still tough for those first-time buyers. The borrowing environment is still the biggest factor that’s causing first-time buyers, and even investors, to wait on the sidelines.

First-time buyers make up about 35 per cent of new home purchases, but they’ve been especially affected as the housing-cost-to-income ratio has climbed well above historic norms in recent years.

This initiative aims to help keep young professionals and families from moving away from the Greater Toronto Area and the province.

HERE ARE THE TOP FIVE TRENDING STORIES OF THE WEEK: 

Real estate executives welcome interest rate cut amid economic uncertainty

Following the Bank of Canada's recent 25-basis-point rate cut, real estate executives have expressed cautious optimism. While the move is seen as supportive for the economy, some leaders feel it may not be enough to significantly boost buyer confidence, citing ongoing affordability issues and economic uncertainty.

Posthaste: No generation in 30 years has faced a bigger challenge to buy a home, say brokers

A recent RE/MAX report highlights that current first-time homebuyers are facing the most significant hurdles in three decades. The combination of high home prices, the OSFI stress test, and a lack of affordable "missing middle" housing is making the dream of homeownership increasingly difficult to achieve.

Toronto seeing 'historic' market downturn with just 53 new condos sold in September: BILD

Toronto's new condominium market is facing a "historic" downturn, according to BILD. Data reveals that only 53 new condos were sold in the city during September, a 90% decrease from the 10-year average, as the market struggles with low sales and stagnant prices.

Today’s homebuyers face uphill battle, but ‘this too shall pass,’ says Kottick

Many Canadians rely on their home as the cornerstone of their personal wealth, but as much as Millennials and Gen Z may want to start building equity, for many, the dream of homeownership is still painfully out of reach.  

There's still one place in the Toronto area where condo prices are skyrocketing

Condo prices in Ontario are dropping at alarming rates as inventory skyrockets, projects are scrapped, and new construction starts fall off a cliff. However, there is still one pocket of the Greater Toronto Area (GTA) where homeowners and investors are cashing in on runaway real estate values.